Investors in risk-off mode ahead of jobs data

Thu Aug 6, 2015 4:48pm EDT
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By Rodrigo Campos

NEW YORK (Reuters) - Weak earnings dragged stocks lower on Thursday and oil fell on continued oversupply concerns, while Treasuries prices rose ahead of U.S. jobs numbers seen as key to determine the timing of a rate hike from the Federal Reserve.

Wall Street traded lower, weighed by biotech shares and on a second day of sharp declines in media companies after Viacom's (VIAB.O: Quote) revenue miss was linked to viewers increasingly shifting from cable television to online streaming.

Market participants were looking ahead to U.S. jobs data on Friday that could give a strong pointer to when the Fed will raise interest rates for the first time in nearly a decade. The Fed next meets in mid-September and markets are split between a September or December hike.

"In a classic risk-off move, investors are selling equities and buying bonds," Goldman Sachs said in a note to clients.

"It is this uncertainty around [Fed] timing that may – in part – be responsible for the risk aversion we're seeing today."

After the closing bell on Wall Street, the Dow Jones industrial average .DJI fell 120.72 points, or 0.69 percent, to 17,419.75, the S&P 500 .SPX lost 16.28 points, or 0.78 percent, to 2,083.56 and the Nasdaq Composite .IXIC dropped 83.50 points, or 1.62 percent, to 5,056.44.

Earlier, the pan-European FTSEurofirst 300 index .FTEU3 fell 0.8 percent with weak corporate results weighing on shares of Deutsche Post (DPWGn.DE: Quote) and Danish enzyme company Novozymes (NZYMb.CO: Quote).

A gauge of stocks across the globe .MIWD00000PUS fell 0.55 percent. Emerging market stocks .MSCIEF slipped to their lowest in over two years on nervousness about the timing and scope of a U.S. rate hike and continued weakness in commodity markets.   Continued...

Pedestrians walk past the Bank of England in the City of London May 15, 2014.  REUTERS/Luke MacGregor